Gold prices set to touch Rs 20,000 per 10 gram by Diwali

MUMBAI: Gold prices are all set to touch Rs 19,500-20,000 per 10 grams by Diwali due to rising investor interest, a top industry official said.



\"We expect gold prices to cross Rs 19,500-Rs 20,000 per 10 grams by Diwali this year after some correction in prices,\" The Bombay Bullion Associations (BBA) President, Suresh Hundia, told PTI here.



The standard gold (99.5 purity) closed at Rs 18,910 and pure gold (99.9 purity) at Rs 19,000 per 10 grams in the Mumbai bullion market.



In New York, gold for December delivery is hovering at USD 1,237.90 an ounce on the Comex division of NYMEX.



Gold may reach at least USD 1,350 an ounce this year as investors seek a shield against financial turmoil, weak currencies and inflation, analysts said.



Indian households are the largest gold consumers in the world. India\'s bullion demand almost doubled in the first-half of the year even as prices reached a record in June.



The forthcoming festive season of Ganesh Chaturthi, Dassera and Diwali may attract more gold jewellery demand.



\"Gold demand is expected to increase due to forthcoming festival seasons and wedding season,\" Hundia said.



Gold prices continued to trade strong in the international market with prices touching multi-week highs in dollar and euro term. This was due to concerns about the health of the global economy and double dip recession fears that is making gold more attractive as a safe haven investment, Bonanza Commodity Brokers\' Senior Research Analyst, Basant Vaid, said.



A stronger Indian rupee against the dollar has somehow restricted gold prices in the Indian market to rise even more sharply but the technical strength is going to push prices higher once again towards the Rs 19,000 mark, Vaid said.



Demand for gold in India rose by 94 per cent to 365- tonnes in H1 2010 compared to 188.4-tonnes in H1 2009, clearly indicating that there has been a rebound in demand. In value terms, India\'s gold demand grew from Rs 27,300-crore to Rs 60,500-crore, an increase of 122 per cent.



\"With the Indian marriage season coming up as well as important festivals like Dhanteras and Diwali, we anticipate gold demand will remain robust throughout 2010,\" World Gold Council, Managing Director, Middle East and India, Ajay Mitra, said.
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